S3.E20 - FMC Round Up!

Topic of the Week (6/28/24):

It's an FMC round up! Let's review some of the major things I'm watching with respect to the Federal Maritime Commission.

The Maritime Professorᵀᴹ presents By Land and By Sea - an attorney breaking down the week in supply chain

with Lauren Beagen (Founder of The Maritime Professorᵀᴹ and Squall Strategiesᵀᴹ)

But first my, TOP THREE STORIES OF THE WEEK:

1 - INTERNATIONAL LONGSHOREMENS ASSOCIATION (ILA) and SC Ports reach a settlement over an ongoing dispute and over 160 signatories send letter to White House

https://www.joc.com/article/sc-ports-strikes-deal-ila-fully-open-leatherman-marine-terminal_20240626.html

https://www.joc.com/article/us-trade-groups-urge-bidens-help-restarting-stalled-ila-usmx-talks_20240626.html 


2 - HMM will begin offering electronic bills of lading on July 8.

https://www.joc.com/article/hmm-digitizes-bills-lading-software-provider-cargox_20240627.html

3 - Two sailing vessels SINK in Newport to Bermuda Race

https://fb.watch/s_okRKrGVA/

https://turnto10.com/news/local/newport-to-bermuda-yacht-racers-rescued-as-two-boats-sink-southern-new-england-rhode-island-june-25-2024 


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#ByLandAndBySea

Transcript

Speaker 1: 0:00

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Speaker 1: 0:58

There's been a lot of movement out of the FMC recently, but most people have been focused on the detention and demurrage final rule, right Rightfully so. Let's take a quick inventory of what else the FMC has been up to. Today. We're reviewing what I'm watching at the Federal Maritime Commission. Hi, welcome to, by Land and by Sea, an attorney breaking down the weekend supply chain presented by the maritime professor me. I'm Lauren Began, founder of the Maritime Professor and Squall Strategies, and I'm your favorite maritime attorney. Join me every week as we walk through both ocean transport and surface transport topics and the wild world of the supply chain. As always, the guidance here is general and for educational purposes only. It should not be construed to be legal advice and there is no attorney-client privilege created by this video or this podcast. If you need an attorney, contact an attorney. But before we get into the discussion of the day, let's go through my top three stories of the week. All right, story number one Two weeks ago, we talked about the ILA the International Longshoremen's Association releasing a statement saying that they were suspending negotiations with the US Maritime Alliance over automation concerns.

Speaker 1: 2:07

Well, this week there was a little bit of good news. A little bit of good news not necessarily for the larger contract discussion, but the South Carolina ports reached a settlement with the ILA over dispute at their terminal regarding jurisdictional concerns about state workers versus ILA workers, dedicated workers at the port and this is an oversimplification, but I wanted to bring this to your attention. We're not going to dive too far into it, but, as the JOC reports, this issue has largely kept the terminal offline since its opening in 2021. So this was the subject of a US Supreme Court case. Joc does a nice job of summarizing. So they said. The agreement, which follows the ILA de facto victory in a legal case that almost reached the US Supreme Court so almost reached gives Leatherman's crane operators a choice to remain state employees or become an ILA member, south Carolina ports said in a statement, state employees at their other container terminals can also elect to become ILA members or they can remain an employee of South Carolina ports. So also in the news this week on the ILA. So that's good news, right. Moving forward settlement discussion agreements right. Those are always good things, and the fact that a port will now be able to work more effectively is a great thing for the free flow of goods right.

Speaker 1: 3:22

But also in the news this week on the ILA there were over 160 signatories to a letter representing all corners of the US supply chain. They sent a letter to the White House asking for the administration to provide any and all support to the parties so that they can reach a final agreement, the parties here being obviously the ILA and the US Maritime Alliance. They want something moved. They are nervous about the potential for a work stop or a strike or anything happening after the expiration of this master contract, september 30th. I said this last week or a few weeks ago. We have a lot of time between now and September 30th, but we also have a lot of political things happening in the meantime, not least of which is the US presidential elections. So as we get closer to September 30th. Hopefully it stays insulated from the politics. I mean I don't know how it could, but hopefully it stays insulated from the politics. Hopefully some sort of agreement is achieved before they get to September 30th, expiration of this master contract. But we'll see. But over 160 signatories to a letter I mean that's a lot of people signing on saying please do something. They said provide any and all support to the parties so they can reach a final agreement. We'll see. I'll keep watching this. The entire industry is going to keep watching this. Hopefully maybe the pressure will be lessened during the summer months and they can come to an agreement not only in their regional agreements but also in that master contract before the September 30th, because I think August is going to be here before you know it and then we're looking at September and September 30th comes quick. So we'll see. All right Story.

Speaker 1: 5:03

Number two we're continuing to see a movement towards electronic bills of lading. This week JOC reported that HMM Hyundai Merchant Marine will begin offering electronic bills of lading to their customers starting July 8th. They're going to be using software from CargoX which is based on Digital Container Shipping Association's DCSA standards. So nine of the top 10 carriers last year committed to using only EBLs electronic bills of lading by 2030. So I mean, I think we're really going to continue to see, obviously, this migration toward electronic bill of lading use. So what does this mean for you? Start checking your own systems right. Are you ready for EBLs? Are you ready for electronic bills of lading? Time to start making those plans? I'd say it's 2024, and this is going to. This is committed to happen by 2030 for nine of the top 10 ocean carriers. So if you deal with ocean carriers, maybe it's time to start looking at your system's ability to process and use EBL. So just a not legal advice, obviously perhaps the best practice, or just a check into your system's advisory. So all right.

Speaker 1: 6:16

Story number three this story caught my attention this week. I didn't see it really reported anywhere. I was only able to source information on this from the Facebook page and Turn to 10, which is a Rhode Island-based news company. So last week, on June 21st you may or may not have known, but the Newport, rhode Island, to Bermuda sailing race kicked off the Newport to Bermuda. They kicked off and during the race, two boats sank.

Speaker 1: 6:47

Two Wild stories too. So the first one, alliance. They think that they might've actually hit a submerged container. So from the Facebook page, like I said, but it was direct source, I mean it was from the Newport Bermuda Facebook page talking to the Coast Skippers and they were recounting what happened. So what they think is they heard a loud boom on the keel and then they heard a loud second boom on the rudder and they said that the boom sounded metallic and they said it gave them their fatal blow and that they were then taking on water, their fatal blow, and that they were then taking on water and the damage was too much that they couldn't fix it and the decision was made within 20 minutes I think they said 30 minutes to abandon ship. They said they were fortunately rescued quickly by fellow racing sailing vessels, but then this was followed by a second sailing ship, the Gunga Din, having to abandon their vessel 80 miles from the finish. The suspected cause of the second vessel taking on water was not actually announced. I couldn't find where it was. At one point I've heard that maybe they both thought that they hit containers. I didn't find any evidence of that or any story recounting of the Gunga Din on what happened there. But look really interesting. The first vessel, the Alliance.

Speaker 1: 8:08

There's an interesting 12-minute video on Facebook like I said, I'm going to link it in the show notes here where the co-skippers Mary Martin and Eric Irwin recounted the evening of the collision and attribute their preparedness to not only their robust safety program of the sailing vessel but of their training from their careers. So Mary mentions having served shortly in the US Merchant Marine and was actually a graduate from Massachusetts Maritime Academy. I love to see it right Merchant Mariners and Maritime Academies. And Eric, his experience was actually as a naval submariner and a retired Navy officer. So I mean that's great.

Speaker 1: 8:45

Also, I wanted to just kind of clarify some terminology here. I don't think that I've stopped and paused and explained this quite, and I see that these terms are sometimes misused, or certainly the second term is maybe not used, but we've been talking a lot about ship strikes periodically on this program between the Baltimore Bridge and now this collision at sea. I wanted to take a minute to clarify those terms right. Elysian is an incident where a vessel hits a fixed object, like a bridge, an elysian, and the collision is where two moving objects strike each other. So the bridge accident you've heard me refer to it as an elysian. That's what it was A vessel hit a fixed object.

Speaker 1: 9:24

It was an elision, because it can't be a collision, because the bridge isn't moving either. So it's an elision. But the container strike right. The sailing vessel hitting a container out there. I mean I guess I'd most appropriately call it a collision because both objects were moving. I mean there wasn't propulsion on the container, I wouldn't think or the alleged container we're still not really sure what it was out there, but what else could it be out in the middle of the ocean? I don't know. But they said right. So an elision is hitting a fixed point with a vessel and a collision is where two moving objects strike each other.

Speaker 1: 9:57

Just a little point of clarification because, as you listen to this podcast, I always like to clarify and make you better maritime-focused audience members. So, continuing on with the story, right, they were about 80 miles from the Bermuda finish when the Gunga Din said that they were taking on water and, like I said, it was according to the local Rhode Island reporter, news 10 WJAR. We'll see. Well, this is interesting. And, like I said, it was according to the local Rhode Island reporter, news 10 WJAR. We'll see. Well, this is interesting.

Speaker 1: 10:31

I'm interested to hear what happened with the second vessel and why they were taking on water. I mean, the alliance sunk. I'm not sure exactly what ultimately happened to the Gunga Din. Information is still coming out about that. I mean, that only happened. The alliance sunk on Sunday, so two days after the race started, and I believe the Gunga Din was taking on water, like I said, 80 miles from the finish. Um, I think that was Tuesday, perhaps, um, but yeah, all in all, this year there were 160 boats in this race and it's a 636 mile race from Newport, rhode Island, to Bermuda. So really interesting and so thankful that all members of both sailing teams were fully accounted for and everybody's safe and survived. And what a story.

Speaker 1: 11:19

All right, well, let's get into the meat and potatoes of the day. Here we are doing a roundup of all the things that I'm watching from the FMC, or at least certainly some of the most prominent things that I'm watching. They're not necessarily moving fast, but I do think that they're still worth watching and mentioning every once in a while. So let's get into it. So the first one is the petition for the extension of time for the detention and demurrage billing requirements. So this is the petition of the Ocean Carrier Equipment Management Association, osema, for an extension of the effective date of the final rule of demurrage and detention billing requirements. So this one we talked about, it was filed close to the effective date of the May 28th and it was asking for an extension of time, saying basically, look, once they had, once the FMC had clarified the final rule and made those amendments, they said that they only had what? 19 days to review that and change their systems. So comments were requested in this petition and so far the comments I mean there weren't a ton, they were maybe less than 10, maybe six, I believe. They didn't show a lot of love for the extension of time and I'm going to be bringing in a few of the quotes that were said.

Speaker 1: 12:35

So Container Port Group said, and I quote extending the compliance window at this point would just lead to massive confusion and create an admin nightmare for all parties involved. Ok, and, like I said, these are just some of the commenters. Right, this isn't necessarily everybody out there and all that, all that they feel, but certainly these are the comments that are filed and, as I always say, if you don't file comments, you can't have your voice heard here. So if you feel differently than the comments that I'm going to be quoting here certainly get those comments in. It's important. It's important to stay engaged in the process, especially when comments are requested.

Speaker 1: 13:13

San Antonio Broker Services says as an owner of a trucking company that services the ports, I feel that any extension of time to the Ocean Carrier Equipment Management Association is unnecessary and uncalled for. When we, as truckers, ask for an extension of time from when they never gave us any, rather, they shut us out so that they could hurt us financially as well as put us in a position to not only lose our customers but also our business. Enough is enough. The date should stand. That's San Antonio Broker Services.

Speaker 1: 13:41

Mallory Alexander International Logistics says that they strongly oppose any extensions and urges the FMC to allow the final rule requirements to remain in place. The alleged confusion over the final rule cited by Osema was clarified by the FMC prior to the rule taking effect. The claim that ocean carriers have only had 19 days to review and revise their billing practices fails to recognize their failure to take responsibility. Despite several years of ongoing discussions surrounding their unfair billing practices, despite pleas from motor carriers documenting those practices and the clear directive put forth in OSRA 22 more than two years ago, they have had more than enough time to figure out how to bill fairly and accurately. That was a quote from Mallory Alexander International Logistics. I mean, these are kind of scathing. You can tell that there's some emotions involved here, right, certainly unhappy with past things that have happened, but ultimately they're saying, look, they oppose these extensions. The last one that I'm going to read here is the Bi-State Motor Carriers Association where it says the Bi-State strongly opposes any extension and urges the FMC to reject a seamless petition allowing the final rule requirements to remain in place. So I'll continue to watch this right.

Speaker 1: 14:50

I said previously I'm not exactly sure, especially because this final rule has already gone into effect. It would be a big thing to pause it. But what Osema might be asking for is if they're found to have any noncompliance, perhaps they could be justified in noncompliance if the FMC, kind of post-hack, puts a extension for that effective date. So like, let's say, something happened on May 30th where the effective date was May 28th. If the FMC were to say look, we think that you well, not the FMC really, but the Court of Appeals here if the court were to decide that Osema should have had an extension of time, that's where it could potentially play in is how I maybe see it being effective. I don't think the entire rule is going to be paused but there potentially might be a look.

Speaker 1: 15:46

We're going to backdate the effective date out to June 15th or whatever, to kind of afford for any inconsistencies in that time. We'll see, we'll see. I mean we're still. We are one month from the effective date. Today is June 28th. We are one month from that effective date of the detention and demurrage rule. I kept saying once we hit that 30-day mark, once we hit that one month mark, it's going to be interesting. I think that this is going to be an interesting next few weeks when we start to hear about how all of that 30 days, issuance of invoice and dispute filing and website dispute information and instructions this is where we're going to start to see the rubber meet the road. But we'll see. We'll see this petition staying on message right. So this petition for the extension of time for ASEMA we'll see. The comments filed so far are certainly not favorable to the petition as I read them, but we'll see where that goes. The other petition that we're watching right is the petition in the US Court of Appeals for the DC Circuit.

Speaker 1: 16:57

This is the World Shipping Council's petition against the FMC's rule? There's not. We brought this up quite a bit. There's not much movement on this, other than there was a request to include an email exchange between the FMC's general counsel, chris Huey, and the World Shipping Council CEO, john Butler. Sees General Counsel Chris Huey and the World Shipping Council CEO, john Butler. It's a pretty interesting exchange but at this point we haven't heard much from the court and that's really what I'm waiting for.

Speaker 1: 17:20

The exchange is really kind of talking about the ability to issue invoices to motor carriers when they might be directly contracted or part of the overall. The World Shipping Council essentially said that there wasn't jurisdiction here for the FMC and that basically a petition against the whole final rule, but also clarification for that part of it on issuing invoices to motor carriers and how motor carriers are part of those direct contractual relationships, or the explanation in the preamble, which is ultimately where the FMC made their rule correction right. So the FMC as we've talked about before and please go back to some of the old episodes on that but the FMC issued their final rule correction, but they only issued that in the preamble and the discussion. So I'm really still waiting all this to say. I'm still waiting on the court to say something. There were some procedural deadlines around the May 20th date.

Speaker 1: 18:27

We didn't hear much out of the court. I was thinking maybe if we were going to hear something, that would have happened then, meaning eight days before that rule was supposed to go into effect. It did go into effect. We didn't hear anything from the court. I'm still looking at the docket. I don't see a lot happening from the court perspective, certainly filings back and forth and that sort of thing.

Speaker 1: 18:46

But I'm going to keep watching this. I'm not exactly sure, similar to the other petition for the extension of time, where that might have a little bit more likelihood because it might not impact the industry. I don't think that this court would want to stop a rule that's already gone into effect full stop, right? I mean, that's kind of what's being asked here, especially since it's such a significant update to how detention demurrage invoices are issued and the contents of those invoices, right. I mean, so this rule has really been lauded as trying to clarify what has happened or how detention to merge is approached from an invoicing perspective. Right, the billing party, the billed party. I'm going to keep watching this petition. I think that it's interesting. I think that this has some potential for significant impacts. If the court were to decide to somehow stop, delay, pause or overturn this final rule on detention and demurrage and I say that because the FMC clarified what the World Shipping Council was asking for clarification on that might have made some significant changes. We'll see. We'll see, but, like I said, there was some discussion about including an email exchange where they were talking about the questions that the World Shipping Council had on this final rule with respect to the motor carriers. Still watching this. I'm going to keep watching this. I periodically check into the docket and I think that this is an interesting one.

Speaker 1: 20:26

The other thing that we're watching is the chassis investigation cases. Right, so I'm still watching. After the FMC announced that they would be investigating possible failure to comply with chassis provisioning orders. So, off of the announcement from the Federal Maritime Commission, it said the FMC opened an investigation today to determine if the Ocean Carrier Equipment Management Association, or SEMA, and its members are complying with a decision issued earlier this year establishing the right of shippers and truckers trucker choice in chassis provisioning for merchant haulage in four key US markets. As the FMC explains, the commission initiated the non-adjudicatory investigation in response to reports that chassis providers in Los Angeles, long Beach, chicago, memphis and Savannah are not complying with a cease and desist order issued by the commission on February 13th 2024. In the case, case intermodal motor carriers conference American Trekking Association versus OSEMA Ocean Carrier Equipment Management Association that's docket number 20-14.

Speaker 1: 21:24

In case anybody wants to go into the FMC's reading room, you can actually look at the docket and see what's been filed. What's going on the decision that was determined at that point or the partial decision that was determined filed. What's going on? The decision that was determined at that point or the partial decision that was determined. So the announcement continues on. The investigation will be conducted by the Commission's Bureau of Enforcement, investigations and Compliance and will examine whether OSEMA and its members have altered their policies and practices as required by the cease and desist order. Non-adjudicatory investigations provide BEIC that's that Bureau of Enforcement, investigations and Compliance with subpoena powers as a discovery tool. Evidence of wrongdoing uncovered by BEIC may be used by the commission to seek an injunction in federal district court. Beic can also use any evidence of wrongdoing to initiate its own enforcement action and seek civil penalties for non-compliance with the commission order.

Speaker 1: 22:12

So this all comes from this ongoing case, this Intermodal Motor Carrier Conference, american Trucking Association, osema versus OSEMA. One interesting update here on that case that docket the DOJ, the Department of Justice, filed a motion for leave to file a brief amicus curiae. So that's essentially a right amicus curiae, a friend of the court, offering additional information or perspective on this case, and so what the DOJ said in their filing was that they wanted to quote help to clarify two issues that have risen in this matter One, the division's business review procedure and two, what weight, if any, the commission should give to a business review letter that the division issued in 2014 to independent equipment providers, flexivan Leasing and Direct Chassis Link. I'm going to keep watching this one. There are a lot of issues going on here, certainly one issue being the jurisdictional authority of the FMC over chassis and chassis pools. Right, I mean, that's partly what some of the contention is here. There's a gray area on the FMC's jurisdictional authority. Certainly, there's a move toward and, depending on who you ask, right saying that the FMC has jurisdictional authority over through bills of lading and through bills of ocean shipments, but is regulating the competition or perhaps the anti-competitive actions in chassis part of that right? That's where I say that this is going to be. Hopefully the FMC will weigh in on that gray area jurisdiction and I mean they've certainly said that in some of their initial decisions or partial decisions here. But this is going to be an interesting one. Also, the chassis side of things, right, the chassis pools and the anti-competitive impact that the FMC has said that those pools in merchant haulage have. We've gone into that case a little bit more in previous episodes. I encourage you to go look at those.

Speaker 1: 24:01

But as we learn more from this, it's getting legally procedurally interesting, confusing, complicated. So I'm going to keep watching this and ultimately, as you know, I try to break things down, I try to oversimplify them so we can all understand what's going on this one, I want to wait a little bit more because I think that there is so much contention here that I want to make sure that I don't miscategorize or misexplain what I'm seeing in these chassis cases. There's a legal procedure that's happening, there's an investigation on the cease and desist order, there's attempts at appeal and I say attempts at appeal because technically the full docket isn't final but there's this one decision that is, and so I just want to make sure that we get a little bit more of the full picture here. As you know, I'd like to stay fair and just explain what's happening from a neutral lens, and that's what I want to make sure that I'm doing here. So I've covered that before. I'll continue to watch it and certainly cover it in more detail as we get more information on the chassis cases.

Speaker 1: 25:11

We also have a string of store-to-door cases right. These are the Samsung, flexport and Peloton. Look, we've talked about Peloton versus Flexport. We've talked about Samsung versus a few different carriers that they filed against. But this is basically store-door movements and the argument hinging on the incentivization principle, saying that the complainant so the one filing the lawsuit understood that they were under a store door arrangement and that they had no control over the movement of the goods, and so what that means is that they thought that whoever they're contracting with was going to move it all the way from the warehouse to their door, and so anything in the meantime really was not under their. Whoever contracted for the movement of the goods, it was not under their control, and so why should they be? This is their argument. Why should they be responsible for detention and demurrage charges when they had no reason to be assessed? Those because they had no, they had no um control over the movement of the goods.

Speaker 1: 26:13

And and ultimately, if detention and demurrage should be, as the FMC has said a few times, based on the incentivization of the movement of the goods, right, I mean you could go with the Evergreen case they're saying where they said that weekends and holidays, because you can't actually move the goods during that time period, that the FMC has said that dampens or that what's the word I'm looking for here that creates an impossibility of movement, right, which goes against that incentivization of the movement of the goods. And so what they're saying is look, it was impossible for us to do anything to move those goods and so there is no incentivization for us to move those goods because we weren't supposed to be part of it. Distillation of what Samsung is saying and what Peloton is saying. In these store door movements they're saying, look, they could not control the incentivization of the movement, they could not control the movement of the stuff at all, so why should they be responsible for those charges for things not moving? Right, detention or demurrage, some of the Flexport complaints, as we've talked about before, but Flexport said, or some of the Peloton complaints that Peloton said against Flexport, saying Flexport assessed the detention demerge charges against Peloton and Peloton containers and circumstances where Peloton was not the party responsible to pick up, move or return those containers. And also they said Peloton said Flexport assessed the D&D charges against Peloton and Peloton containers and circumstances where charging Peloton detention to merge charges did not incentivize the pickup of the cargo or primarily function to promote cargo fluidity. So the ultimate question on the second part being if the BCO ship are now under the detention to merge rule, as the build party is not responsible for the movement of the goods at that stage and the assessment of detention to merge would not have the effect of incentivizing the movement of the goods because the shipper couldn't or wasn't supposed to do anything about it, then can the carrier or whoever was contracted the NBOCC properly charge detention to merge back to that customer, back to that shipper? We'll see, we'll see. We'll see. Based on what the FMC has previously said, especially about that incentivization rule, it seems like the answer might be no right, that this shouldn't have been charged back to the person who, under their complaint filing, had no control over the movement of the goods. But we'll see.

Speaker 1: 28:35

And I want to be careful here because, as I've said before and as I'm going to say now, this is just one side. We have had motions to dismiss filed in almost all of these cases. There's been some interesting conversations in those motions to dismiss. But I'm going to. I'm most interested here in what the FMC has to say about these cases. So I'm going to wait on these as well. Like I said, I want to bring up things that I'm watching and the reason for kind of not diving into them more fully yet as a discussion. But at this point I'm most interested in what the FMC has to say about these and we're not going to be there for a kind of collective case law decision on how things can be applied, how this incentivization principle moves in the D&D world and who it moves on right, who these charges are for. So we'll see. Going to continue to watch, all right.

Speaker 1: 29:33

The other thing that I'm watching minimum quantity commitments and the enforceability of service contract terms, right? So remember, we talked about this when we were contract commitments to Bed Bath Beyond against the carriers that they were filing against. They were saying that the detention of urnage assessed for periods of time in which Bed Bath Beyond's ability to pick up containers at the ports or return empty containers promptly was constrained due to circumstances outside the control of Bed Bath Beyond, such as congestion policies implemented and that sort of thing. But then the third allegation that Bed Bath Beyond at least had in these cases was introducing Bed Bath Beyond to enter into premium rate contracts as a precondition to carry out just a fraction of the quantity, scooting them to spot market right. That's what this kind of hinges on. They were alleging that they had minimum quantity commitments on an annual basis that averaged out to per month.

Speaker 1: 30:42

And this is where I think that I'm most interested to follow these is the enforceability of service contracts, because when you get into and I don't want to go into a full contract discussion in the legal world, but when you get into service contract commitments, you get sometimes a better rate based on a commitment of a certain number of TEUs 20 equivalent units. So that's a container right. Most containers that we see these days are 40 equivalent units of 40 feet long, but they're still mostly measured in kind of that TEU 20 equivalent unit, which is like a half size of what we mostly see on vessels and on the road and I say on the road when a ocean carrier box. It's different than what's on a truck. The ocean carrier box sits on a chassis and gets pulled behind a truck, but really they usually don't go too far, a hundred, maybe 200 miles away from a port, but like, the trucks you see in the middle of the country are not the same boxes obviously that you would see on a vessel.

Speaker 1: 31:43

Okay, so minimum quantity commitments and service contracts right. So that saying they might have, in this case, right, it was 2100 FEUs annually. So 2100 FEUs annually. They said it worked out to be an average of 175 FEUs, but I mean, really it's annually. So what's the term, what's the period of time that those FEUs, the 40-foot equivalent units, were supposed to be moving, and how can you enforce that? So you get to the end of the year. Are they supposed to move 2,100 FEUs in December? I mean no, right. I mean that's probably not feasible. There was no like, if they didn't move anything in April, can you come after them for that? Because they didn't necessarily say that a certain number had to be moved in the month of April or even on the day of April 16th, right? So if they had said you need to move 50 boxes on April 16th, that's something you can enforce, right, that has that enforceability. But if you say, during the year 2020, you were supposed to move 2,100 FEUs, that's the question here. That's something that I think the potential of the string of cases has the potential to serve and to provide clarity. So we'll continue to watch these Minimum quantity commitments right in the service contract enforceability. The last thing that we're going to watch these Minimum quantity commitments right and the service contract enforceability. The other, the last thing that we're going to be mentioning here today, because we've already been talking for quite a while, but the last thing that I want to highlight is the MTDI. Right so, the MTDI there were comments required, or there were comments due last week or two weeks ago. They're in, they're in and those comments have been filed. I'm still working my way through them, but I wanted to let you know that there are comments filed. This was on the request for information.

Speaker 1: 33:43

Number two, and just as a overall background of the MTDI, because we just talked to Commissioner Bensel a few weeks ago. Commissioner Bensel, in December 2021, began holding meetings with maritime and intermodal stakeholders. These were one-hour meetings sometimes a little bit longer that were held roughly every week and they ran from December 2021 to June 2022. And they culminated with a data summit. These one-hour meetings that ran for I think it was 18 different sessions are on the YouTube page of the FMC.

Speaker 1: 34:15

Go check them out. You don't have to look at all of them, but go check them out. And they are broken into industry sectors and it's so interesting to hear I mean, it was, it was what four years ago now, or three years ago, two to three years ago so not that long ago but they're still relevant. These conversations are still relevant. Some companies have have long since gone away, but there are still relevant. Some companies have long since gone away, but there are still quite a few companies that are still there and still building that. I think that hearing from the perspective of the companies on data exchange and maritime data information is still relevant and that was kind of the foundation, the building blocks to this larger conversation that we're having as a supply chain ecosystem and certainly as a country, but as a supply chain ecosystem internationally. It could, at least in part, be based on the conversation started with these video recordings. So if you haven't yet, I strongly urge you to go check out these videos. They're so interesting.

Speaker 1: 35:19

But yeah, so this effort was called the Maritime Transportation Data Initiative and Commissioner Bensel said that he focused on three different objectives with this initiative. So, and it continues on right Cataloging the status quo and maritime data elements, metrics, transmissions and access, identifying key gaps in data definitions and classifications. And developing recommendations for common data standards and access policies and protocols. So go check out those videos. They were OTIs freight forwarders, nvoccs, ocean carriers, which included Hoppag-Lloyd, msc, one, costco, zim, large aggregators, flexport and CH Robinson. Maritime labor standards bodies, including DCSA and NIST. Technology platform providers. We had NYSEX, we had Cargologic, we had other US government agencies, usdot, cbp Commerce, usda railroad stakeholders, mtos. I mean, you get the idea. He covered a lot of ground with this initiative, and so what are we talking about now? Of ground with this initiative? And so what are we talking about now? The RFI? Number two the request for information. Number two he was asking for additional information from the shipping public to expand the information gathered from the MTDI sessions and address additional topics related to data availability, accuracy and exchange.

Speaker 1: 36:31

This is just. There's so much value. There's so many gold nuggets in this entire process. So go, take a look, stay engaged. Much value, there's so many gold nuggets in this entire process. So go, take a look, stay engaged, pay attention here. This is all really interesting. So those are the big things that I've been watching. So I'm going to continue to watch. We'll do larger, deeper dives as the stories start to develop and there's more of a complete picture.

Speaker 1: 36:53

But I did want to raise today all of the things that I'm watching and raise these back to the top, because while the detention to merge final rule certainly is important, there's a lot of things happening around it. But then there's a lot of things happening that have the potential to set precedent through the FMC cases. I've said this before the FMC really prefers, when they do rules and regulations, to stay in the guardrails right. They want to kind of provide the guardrails around the industry and they want the case law to determine the specifics, the details, that application, because then you get an actual fact pattern and then you can apply the application right of that rule or whatever it is to those cases, to those fact patterns, and that's what we're starting to see here. I also want to bring up we have the unreasonable free-to-deal and negotiate with respect to bustle space accommodations.

Speaker 1: 37:47

That rule is still ongoing. That has the potential for some significant impact in the industry. Although it still is guardrails, there are some definitions in that rule that I always encourage you to take a look at. Comments have closed on that. We're expecting a final rule, probably a final rule on that in the next few months, maybe next few weeks. The FMC chairman, dan Ruffet, has mentioned a few times that he expects that final rule to be out, so we're still waiting on that. That'll probably come out, hopefully sometime this summer. That one has potential to be really impactful for the industry and he said that it's a tricky rule that they need to get right. So I'm going to continue watching that as well.

Speaker 1: 38:29

But, as always, the guidance here is general and for educational purposes. It should not be construed to be legal advice directly related to your matter. If you need an attorney, contact an attorney, but if you have specific legal questions, feel free to reach out to me at my legal company, squall Strategies. Otherwise, for the non-legal questions the e-learning, the general industry information and insights, the employee trainings come find me at the Maritime Professor. If you like these videos, let me know, comment, like and share, and if you want to listen to these episodes on demand or if you missed any previous episodes. Check out the podcast by Landon by Sea. If you prefer to see the video, they live in my YouTube page by Landon by Sea, presented by the Maritime Professor. And while you're at it, check out our website, themaritimeprofessorcom. Until next week. This is Lauren Began, the Maritime Professor, and you've just listened to by Landon by Sea. See you next time.